Pledge Of Accounts Receivable Research

Basing on the theory of pledge of general obligations, and according to the system of modern chattel security which established on American Uniform Commercial Code, the author focuses on comparative analysis in and rational discussion on the concerned issues of pledge of account receivable in China, aims to perfect the system of pledge of account receivable in our country.This thesis is divided into five parts.In the first part, with development of pledge of general creditor's rights, through analyzing the international and domestic modern chattel security, the author presents theoretical basis and realistic factors of pledge of account receivable.Actually, the pledge of account receivable is the pledge of general creditor's rights. So the latter's birth is the academic base of the former. The system of the pledge of general creditor's rights came from the Roman Law. Succeeding to the Roman Law, in latter day continental law system countries had in succession constructed their own law system of pledge including pledge of general creditor's rights. In ancient China there was a style of "pledge" in which a person delivered chattel, real property, or person to another as guaranty. But till the period of the Republic of China, modern pledge system had appeared. With old laws was abolished by the PRC, the pledge system disappeared until 1986, when General Principles of the Civil Law was enacted which prescribes "mortgage", involving "pledge". At a later time, although in Guaranty Law pledge is stipulated as one chapter solely and pledge is divided into pledge of movables and pledge of rights, whether general creditor's rights can be object of pledge was unknown. In 2007, the pledge of account receivable (one of general creditor's rights) is prescribes firstly in Real Right Law of PRC.The realistic reasons for the appearance of pledge of account receivable are the world trendy of modern chattel security and the state of chattel security in our country. With rise and flourish of the market in which bodiless property rights such as general creditor's rights, creditor's rights of securities are trade object, account receivable as the biggest asset in medium and small-sized enterprises becomes important in enterprises' financing. Therefore, so many countries have established the security system of account receivable. But in our country, most enterprises' financing are obtained from the mortgage of real property, which results in difficulty to gain financing for medium and small-sized enterprises. On the other hand, because of the shortage of account receivable financing, Chinese-funded Bank appears to be weaker in world competition.In the second part, the author makes a definition of pledge of account receivable, and then compares it with assignment of account receivable and international factoring. The author also expresses her opinion on the issue about whether it is "pledge" or "mortgage".Pledge of account receivable means the civil act that the debtor or the third person delivers account receivable to the creditor as a security that the debt will be repaid. Transfer of account receivable is materially transfer of creditor's rights. The author don't agree with the view that pledge of account receivable is materially transfer of it. First of all, the pawnee "control" the object not only by restriction on pledgor beforehand, but also by recourse when the property has been disposed without the consent of the pawnee. So the view that registration can't "control" the right of account receivable can't stand. Secondly, in the transfer of account receivable, the seller has the desire to sell and the "ownership" changes as a result. This is really different from pledge. Thirdly, although transfer of account receivable is generally adopted, there is still condition of using pledge of it. Factoring is an all-around operation for financial service which involves transfer that is the core of the factoring, management, gathering, assurance, etc.According to the criterion of mortgage of rights and pledge of rights in traditional civil law, objects of mortgage of rights are real property rights and objects of pledge of rights are the rest. Therefore the security right of account receivable shall be the right of pledge. But actually such compartmentalization is not fit for lawmaking trend of the international chattel security. Wipe off the way of the traditional chattel security system, categorizing by concept. The third part concerns establishment and entry into force of the pledge of account receivable.Generally, pledge contract in writing and pledge registration are the preconditions of the pledge of account receivable. However, there is seldom demonstration for the reason why written contract is essential. The author thinks written contract is not necessary. Because of the public show of registration, written contract becomes useless in public show, but often used to decrease dissension. Law encourages and guides parties to make written contract, but compulsory.In China, the registration public show of account receivable pledge is more useful in public show, compared with notice and delivery creditor's rights certificate. Some people think that registration essential doctrine and material examination complement each other. In China, registration is precondition of pledge. Registration agency only does formal examination for registration. According to author's thought, China's system seems different from traditional civil law theory, but it is more reasonable. There is no essential connection between formal examination and registration counter doctrine as well as material examination and registration essential doctrine. In the field of account receivable pledge, pledge registration avoids shortages of material examination without public faith. It is not very harmful to security of dealing. However, the law risk is also existed in the pledge of account receivable due to not perfect public show system of creditor's rights.In the fourth part, the author expounds the issue about force of pledge rights.The effect scale of account receivable pledge includes the scale of creditor's rights and object of account receivable pledge. The rights of Pawnee includes taking in interest, restricting the behavior of pledgor and the third debtor, transferring pledge and other rights are subrogation, claiming cancellation, receiving priority repayment and requirement for placing subject matter in escrow. In order to avoid termination of account receivable creditor's rights with the end of time, pledgor has obligation of clam with urgency. The right of pledge mainly takes effect in restricting the repayment act of the third debtor. The fifth part is about implementation and elimination of pledge rights of account receivable.Being different from old laws, Real Right Law permits parties to consult about the conditions of implementation of pledge rights. The main way to implement pledge rights of account receivable is to ask the third debtor for repayment.The elimination reasons of pledge rights: creditor's rights elimination, pledge right implementation and abandonment, etc. One account receivable can be set up more than one pledge right. When pawnee and creditor are same person, in order to confront the latter pawnee, pledge right does not eliminate.